Monday's Auction was a near perfect Range Day which saw price containment within well defined price distribution of the Initial Balance (1st Hourly Range) of 1099.00 - 1090.00. Price gapped up early only to fade quickly back to Friday's settlement price before attracting buyers...Price auctioned back into the IB Range and found two-sided action for the remainder of the session. Range Day trade is fairly well defined but can be gut-wrenching for the amateur which calls for fading the "edges". One of the most successful ways to handle this is to trade responsively at the +- 2 Sigma Levels (standard deviations). At TradePilot Pro we refer to this as "fade the raid to get paid"...The chart below is the 30 min TPP Delta which clearly highlights the key levels to consider trades..i.e.+-2 Sigmas...which offered the trader a well defined "reversion to the mean" profit opportunity.
Key Reference Zones:
Initial Resistance: Monday's Pre-market high at 1103.00
Secondary Resistance: 1109.00 then, 1119, 1126.00
Initial Support: 1085-1086 November / January lows
Key Support: 1080.00
Good Trading
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Blending Market Structure, Fibonacci, and Volume Analysis
Joe Baker
Founder of Trade Pilot Pro, business entrepreneur for past twenty-two years in Real Estate & Financial Industry. Self-taught trader and Financial Software developer, member of Market Technicians Association, working on CMT designation
David Dube
Professional Trader for over twenty-five years having held Senior Trader positions at Lehman Brothers and UBS Investment Bank. David's knowledge and experience of Global Markets brings a unique trading perspective to Trade Pilot Pro's members. Currently living in Connecticut with his wife, he is an avid aviator holding Commercial and Instrument Ratings.
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Trading of securities, options and futures may not be suitable for everyone and involves the risk of losing part or all of your money. Commentaries are educational in nature and are designed to contribute to your general understanding of financial markets and technical analysis. Use it how you want and at your own risk. We are not registered investment advisors. This information is a general publication that reflects our own opinions and is not a specific recommendation to any one individual. You must consult your own broker or investment advisor for investment advice. Past performance is not a guarantee of future success. Controlling risk through the use of protective stops is essential.